Sprint Nextel Corp. is launching an over-the-air music service, an
offering the company hopes will entice customers to pay high per-song
fees in exchange for the instant gratification of wireless downloads.

The Sprint Music Store went live Monday with a catalog of songs from
EMI Music, Sony BMG Music Entertainment, Warner Music Group and
Universal Music Group that Sprint said numbers in the hundreds of
thousands. For US$2.50 per song, customers receive two digital copies,
one formatted for use only on their phone and another formatted for
downloading to a PC.

Sprint’s music service is supported by two new multimedia phones, the
Sanyo MM-9000, priced at $380 on Sprint’s Web site, and the Samsung
MM-A940, priced at $400. Those phones shipped to stores last week and
are now available for purchase, a Sprint spokeswoman said. The phones
come with a removable memory card for buying and storing songs; an
optional 1G-byte card will store 1,000 songs purchased from the Sprint
Music Store, the company said.

The Sprint Music Store service also requires Sprint’s Power Vision
wireless broadband network, which the company began rolling out
throughout the U.S. earlier this year. Sprint, based in Overland Park,
Kansas, estimates that 130 million people are now in its Power Vision
coverage zones.

Sprint’s $2.50 per-song price more than doubles the $0.99 per track
price pioneered by Apple Computer Inc.’s popular iTunes Music Store.
Sprint hopes the instant access offered by its wireless service will
persuade customers to pay its higher fees.

Sprint’s two new multimedia phones also allow customers to transfer
music from their PCs to their phones. That functionality will compete
with music player phones from other carriers -- most notably, Cingular
Wireless LLC, which unveiled Motorola Inc.’s Rokr last month in a joint
venture with Apple.

Jupiter Research telecommunications analyst Julie Ask said she expects
the new service to be a good demonstration of Sprint’s Power Vision
network capabilities, but thinks few consumers will change carriers to
take advantage of such offerings. In a Jupiter Research survey of
mobile phone customers, only 1 percent said they picked their vendor
because of its entertainment offerings.

"At the end of the day, it’s still all about price and network quality," Ask said.

Sprint’s $2.50 price tag means its service won’t be the primary way its
customers purchase online music, Ask said. Still, she sees the Sprint
Music Store doing decent sales on impulse purchases, and she applauded
Sprint for offering both phone- and PC-formatted files for one purchase
price.

"Sprint is being realistic," she said. "They’re acknowledging that this is an addition to the other ways [customers] buy music."